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Should Invesco S&P MidCap Momentum ETF (XMMO) Be on Your Investing Radar?
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Designed to provide broad exposure to the Mid Cap Growth segment of the US equity market, the Invesco S&P MidCap Momentum ETF (XMMO - Free Report) is a passively managed exchange traded fund launched on 03/03/2005.
The fund is sponsored by Invesco. It has amassed assets over $1.03 billion, making it one of the average sized ETFs attempting to match the Mid Cap Growth segment of the US equity market.
Why Mid Cap Growth
Mid cap companies, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus they have a nice balance of growth potential and stability.
Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Also, growth stocks are a type of equity that carries more risk compared to others. Even though growth stocks are more likely to outperform their value counterparts in strong bull markets, value stocks have a record of delivering better returns in almost all markets than growth stocks.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.33%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.48%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 24.50% of the portfolio. Energy and Materials round out the top three.
Looking at individual holdings, Carlisle Cos Inc (CSL - Free Report) accounts for about 4.14% of total assets, followed by Steel Dynamics Inc (STLD - Free Report) and Builders Firstsource Inc (BLDR - Free Report) .
The top 10 holdings account for about 24.01% of total assets under management.
Performance and Risk
XMMO seeks to match the performance of the S&P MIDCAP 400 MOMENTUM INDEX before fees and expenses. The S&P Midcap 400 Momentum Index is composed of securities with strong growth characteristics selected from the Russell Midcap Index.
The ETF has lost about -3.16% so far this year and is down about -9.94% in the last one year (as of 03/14/2023). In the past 52-week period, it has traded between $68.65 and $89.17.
The ETF has a beta of 1.01 and standard deviation of 27.60% for the trailing three-year period. With about 79 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap Momentum ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, XMMO is an excellent option for investors seeking exposure to the Style Box - Mid Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Mid-Cap Growth ETF (VOT - Free Report) and the iShares Russell Mid-Cap Growth ETF (IWP - Free Report) track a similar index. While Vanguard Mid-Cap Growth ETF has $9.56 billion in assets, iShares Russell Mid-Cap Growth ETF has $11.45 billion. VOT has an expense ratio of 0.07% and IWP charges 0.23%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should Invesco S&P MidCap Momentum ETF (XMMO) Be on Your Investing Radar?
Designed to provide broad exposure to the Mid Cap Growth segment of the US equity market, the Invesco S&P MidCap Momentum ETF (XMMO - Free Report) is a passively managed exchange traded fund launched on 03/03/2005.
The fund is sponsored by Invesco. It has amassed assets over $1.03 billion, making it one of the average sized ETFs attempting to match the Mid Cap Growth segment of the US equity market.
Why Mid Cap Growth
Mid cap companies, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus they have a nice balance of growth potential and stability.
Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Also, growth stocks are a type of equity that carries more risk compared to others. Even though growth stocks are more likely to outperform their value counterparts in strong bull markets, value stocks have a record of delivering better returns in almost all markets than growth stocks.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.33%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.48%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 24.50% of the portfolio. Energy and Materials round out the top three.
Looking at individual holdings, Carlisle Cos Inc (CSL - Free Report) accounts for about 4.14% of total assets, followed by Steel Dynamics Inc (STLD - Free Report) and Builders Firstsource Inc (BLDR - Free Report) .
The top 10 holdings account for about 24.01% of total assets under management.
Performance and Risk
XMMO seeks to match the performance of the S&P MIDCAP 400 MOMENTUM INDEX before fees and expenses. The S&P Midcap 400 Momentum Index is composed of securities with strong growth characteristics selected from the Russell Midcap Index.
The ETF has lost about -3.16% so far this year and is down about -9.94% in the last one year (as of 03/14/2023). In the past 52-week period, it has traded between $68.65 and $89.17.
The ETF has a beta of 1.01 and standard deviation of 27.60% for the trailing three-year period. With about 79 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P MidCap Momentum ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, XMMO is an excellent option for investors seeking exposure to the Style Box - Mid Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Mid-Cap Growth ETF (VOT - Free Report) and the iShares Russell Mid-Cap Growth ETF (IWP - Free Report) track a similar index. While Vanguard Mid-Cap Growth ETF has $9.56 billion in assets, iShares Russell Mid-Cap Growth ETF has $11.45 billion. VOT has an expense ratio of 0.07% and IWP charges 0.23%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.